FrieslandCampina lands into losses on account of hefty increase in financial cost
By MG News | February 07, 2020 at 10:56 AM GMT+05:00
February 7, 2020 (MLN): FrieslandCampina Engro Pakistan Limited (FCEPL) has unveiled its financial performance for the year ended December 2019 wherein the company reported net losses of Rs 1.1 million against the profits of Rs 63,783 earned last year. This translated into loss per share which clocked in at Rs 1.25 per share.
Sharp economic headwinds, particularly steep increases in commodity costs due to devaluation of Rupee and rising interest rates have put pressure on the overall company’s profitability. As a result, gross margins reduced from 16% to 13%.
With regards to the company’s major expense heads, admin expenses surged by 30% YoY, while other expenses rose by 128% YoY.
During the year, the company also received tax incentives of Rs 144,490 which was down by 38% YoY, still, it failed to mark any significant improvement in reducing its losses as the company witnessed a considerable increase in its finance cost by 80%YoY.
| Financial Results for the year ended December 31st 2019 (Rupees) | |||
|---|---|---|---|
|
| 2019 | 2018 | %change |
| Revenue from contracts with customers - net | 38,857,336 | 32,439,451 | 20% |
| Cost of sales | -33,687,049 | -27285392 | 23% |
| Gross profit | 5,170,287 | 5,154,059 | 0% |
| Distribution and marketing expenses | -3,969,309 | -4,205,762 | -6% |
| Administrative expenses | -1,245,853 | -957,071 | 30% |
| Other operating expenses | -246,874 | -108,475 | 128% |
| Other income | 412,968 | 622,269 | -34% |
| Operating profit | 121,219 | 505,020 | -76% |
| Finance cost | -1,221,574 | -675,340 | 81% |
| Loss before taxation | -1,100,355 | -170,320 | 546% |
| Taxation | 145,490 | 234,103 | -38% |
| (Loss) / profit for the year | -954,865 | 63,783 |
|
| (Loss) / earnings per share - basic and diluted | -1.25 | 0.08 |
|
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